Struck by alleged crime, youth hockey asks city for help

Rush City is being asked for a little break in wake of a theft by swindle allegation that has sent the Pine City Youth Hockey Association reeling.

The city council on Sept. 10 learned all about it from Jeff Steele who, as gambling manager for the association, requested a reduction in the amount of charitable gambling money that the organization is required to donate back to the community. The group lost around $38,000 due to the alleged crime, he noted.

Feeling for the hockey association, as a third of its members consists of Rush City kids, councilors considered Steele’s request but were hesitant to grant it for fear of the ramifications from setting such a precedent.

That and the city has an ordinance requiring organizations involved with local charitable gambling to give 50 percent of what they donate back to the Rush City service area, City Administrator Amy Mell explained. Plus, any proposed amendment to city ordinance would require a public hearing, she reminded.

Earlier in the meeting, the council approved the youth hockey association’s application for a gambling license at Chucker’s Bowl and Lounge. The group also has charitable gambling permits at the Rush City Tavern and Rush City VFW.

The alleged crime

Rhonda Rae Swanson, 54, of Pine City, was charged with felony theft by swindle last July in Chisago County District Court for allegedly stealing $38,000-plus in pull tab money over a span of eight months in 2011, according to the court complaint.

Handling duties including inventory, games, audits and deposits, Swanson worked for the youth hockey association for the last 10 years.

On Aug. 19, 2011, it was the organization’s pull tab site at the Rush City VFW where a member of the hockey association first alerted a special agent with the Minnesota Department of Public Safety – Alcohol and Gambling Enforcement Division of a possible theft of pull tab receipts. The VFW was concerned because the business is required to cover any shortages that occur during the games, the complaint said.

Starting with checking game inventories for the VFW, the association found there were games that had been pulled and closed out in May 2011, but no deposit had been recorded. It was believed that Swanson had falsified the reports the organization is required to file with the Minnesota Department of Revenue. She was the only party responsible for making the deposits with the association’s US Bank account for the games.

When confronted by authorities at one point in their investigation, she admitted she was keeping games in play and taking the money so that she could pay medical bills.

An audit later determined her actions created losses of $38,162 for the games in play at the Rush City VFW and Chubby’s Bar and Froggy’s Bar, both in Pine City, between June 2011 and August 2011.

Swanson made her first court appearance on Aug. 20 and was booked and released. Her next court appearance is scheduled for Sept. 24, with a possible trial date in November, Chisago County Attorney Janet Reiter said.

Meantime, the youth hockey association is seeking restitution in the case, while its finances are back in order with the state. The group also expects to find out soon if it will be fined or penalized for not having the necessary internal controls in place, but there is optimism since “we’ve added more internal controls” to make sure all the games are valid, Steele explained.

The council eventually decided to involve city attorney Peter Grundhoefer and revisit Steele’s request at its next regular meeting, Monday, Sept. 24.

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